Hi, thanks for responding.
Either way the app will be based on web technologies, it's just a matter of who does the hosting. So if customers self-host it should be technologies they're comfortable supporting, which IMO rules out Ruby or Python frameworks since most of my targeted customers would likely be using .NET or Java.
Many businesses of all sizes are very comfortable with SaaS thanks to apps like Saleforce.com. Also, it sounds like you would prefer developing for the web anyway. So, that may be your answer right there.